Michaela
Binance co-founder Changpeng Zhao has called for stronger security measures, including wallet alerts and a blacklist of scam addresses, after an investor recently lost $50 million to an address poisoning attack.
Key Points
- Address poisoning scams manipulate transaction histories to steal funds.
- Even experienced crypto users are vulnerable to large losses from these scams.
- Binance proposes wallet alerts, blacklists, and filtered transactions to improve security.
In a recent blog post, Zhao recommended that wallets automatically verify whether a receiving address is a “poison address” and block it if detected. He also advised that low-value or suspicious transactions be filtered out entirely, rather than displayed, to reduce the risk of scams.
An address poisoning scheme is a type of cryptocurrency scam where attackers manipulate transaction histories to trick users into sending funds to fraudulent wallets. Scammers typically send tiny amounts of crypto to a victim’s wallet first.
When the victim later copies an address from their transaction history, they may unknowingly select the attacker’s poisoned address instead of the intended recipient. This method exploits users’ trust in their own wallet histories, making it a subtle but highly effective way to steal funds.
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The scheme is particularly dangerous because it can bypass standard security checks, and victims often realize the loss only after the transaction is completed.
Just ahead of the Christmas holiday, a crypto user lost nearly $50 million in USDT to a classic address poisoning scam after inadvertently copying a fraudulent address from their transaction history, marking one of the largest on-chain losses of the year.
The user first sent a small test transaction to the intended recipient but, minutes later, accidentally transferred $49,999,950 USDT to a poisoned address copied from their transaction history. The victim’s wallet, active for around two years and primarily handling USDT transactions, had its funds withdrawn from Binance shortly before the fraudulent transfer took place.
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The incident spotlights the growing sophistication of crypto-related scams and the urgent need for enhanced security measures across the industry. As digital assets continue to gain mainstream adoption, even experienced users remain vulnerable to increasingly clever attacks.
Experts suggest that exchanges, wallet providers, and regulators work together to implement proactive safeguards, from automated fraud detection to improved user education on emerging threats. While technology can help mitigate risk, vigilance and cautious practices remain essential for anyone managing significant cryptocurrency holdings.
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MICHAELA
Michaela is a news writer focused on cryptocurrency and blockchain topics. She prioritizes rigorous research and accuracy to uncover interesting angles and ensure engaging reporting. A lifelong book lover, she applies her passion for reading to deeply explore the constantly evolving crypto world.
